The future of the largest stablecoin is being shaped on two fronts: a fast-approaching U.S. Treasury comment deadline and Tether's deepening push into Bitcoin-based infrastructure. The Treasury's notice of proposed rulemaking under docket TREAS-DO-2026-0496, published August 18, closes for comments on October 19, 2026. It defines who may issue, offer or sell payment stablecoins to U.S. persons and how digital asset service providers must treat foreign-issued coins, making it the key implementation piece of the GENIUS Act.
Under the statute, beginning July 18, 2028, it will be unlawful for a digital asset service provider to offer or sell a payment stablecoin to a U.S. person unless the coin is issued by a permitted payment stablecoin issuer. Treasury's proposed definition is broad enough to cover exchanges, brokers, custodians and other businesses that exchange, transfer or hold digital assets. The department rejected strict liability for foreign issuers and retained a safe harbor for those that reasonably believed the recipient was outside the United States, maintained policies against U.S. issuance, and did not market to U.S. persons.
The central question is access for Tether's USDT, the largest stablecoin with about $184 billion in circulation. A foreign issuer can reach U.S. users only if the Treasury Secretary determines that its home regulator's regime is comparable to the GENIUS Act and the issuer registers with the OCC. Tether has argued that USDT and its domestically issued token USAT will meet the same compliance standards. The company launched USAT on January 27, 2026 with Anchorage Digital Bank as issuer, describing it as a dollar-backed token made in America.
Meanwhile, Tether is no longer merely seeking compatibility. The company has enabled USDT on Bitcoin using RGB and the Lightning Network, a move presented as a technical return but widely read as a strategic positioning decision. USDT originally launched on Bitcoin's Omni Layer in 2014 but left as congestion, cost and confirmation times pushed activity to Ethereum and Tron. RGB's client-side validation model anchors cryptographic commitments to Bitcoin UTXOs without publishing the full asset state, while Lightning provides off-chain payment channels with immediate, low-cost settlement.
Tether has allocated more than $20 million to Bitcoin-adjacent infrastructure, including Utexo for issuance and payment routing, Ark Labs for programmability layers, and Speed for Lightning infrastructure. The company also reports roughly 100,000 BTC in reserves and an expansion plan in Bitcoin mining. Analysts view this as a vertical integration strategy: issuance, routing, programmability and mining combine to give Tether greater control over the rails on which the digital dollar moves.
Compliance remains a critical friction. Unlike stablecoins on Ethereum or Tron, RGB has no global address for freeze functions. The proposed workaround is a distributed UTXO blacklist shared with exchanges and infrastructure providers. Enforcement therefore shifts to entry and exit points, raising open questions about adoption, custody standards and KYC obligations. For now, the market is watching the October 19 comment window, the Treasury's eventual comparability determination, and concrete Lightning/RGB liquidity metrics.
